LONDON: Copper prices eased on Thursday as the market’s focus turned to next week’s U.S. Federal Reserve meeting for news on the expected tapering of stimulus for the world’s largest economy.
Benchmark copper prices on the London Metal Exchange (LME) shed 2.6% to $9,372 a tonne by 1607 GMT.
“The tapering expectations are a key focus and next week is the FOMC meeting, which is important to watch as the macro drivers are dominating copper prices,” said Xiao Fu, head of commodity market strategy at Bank of China International in London.
Prices for copper, which hit a record high of $10,747.50 in May, are likely to be rangebound until the FOMC meeting, she said.
If the Fed begins its monetary easing in November-December, copper would face pressure but is likely to remain resilient thanks to supportive fundamentals, Fu added.
Also weighing on prices was China’s plan to release copper, aluminium and zinc from its state reserves and closely monitor market conditions to overcome mismatches between supply and demand.
ALUMINIUM: Prices for the lightweight metal continue to be dominated by supply disruptions in top consumer and producer China as well as surging thermal coal prices, leading some analysts to forecast a deficit this year.
LME aluminium was down 0.3% to $2,883.50 a tonne, having touched $3,000 on Monday.
INVENTORIES: Total aluminium stocks in LME warehouses jumped by 19,250 tonnes to more than 1.3 million tonnes. Meanwhile, the LME aluminium cash contract was at a discount of about $20 a tonne to the three-month contract, its biggest since July 7, pointing to adequate nearby supply.
STRIKES: A small union at top copper producer Codelco’s Salvador division is the latest to reach agreement on a labour contract. The resolution of numerous labour disputes at copper operations in Chile has eased concerns over supply.
OTHER METALS: Zinc was flat at $3,076.50 a tonne, lead rose 1.2% to $2,207, tin was down 0.3% at $33,155 and nickel lost 3.1% to $19,380.
Comments
Comments are closed.